The global economy is on the brink of a recession, with central bank stimulus less forthcoming and growth weakened by the slowdown in China, Citigroup warned on Thursday.

The bank cut its 2016 global growth forecast to 2.7 percent from 2.8 percent and slashed its outlook for the U.S., U.K. and Canada, plus several emerging markets including Russia, South Africa, Brazil and Mexico.

Citi held its growth outlook for China in 2016, but cut it by 0.2 percentage points to 6.0 percent in 2017.

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"China has been slowing down for years and will continue to slow down. The official data greatly overstates the actual growth rate, but whatever it was last year, I think we will lose another percent, a percent-and-a-half of growth," Willem Buiter, the chief economist at Citigroup, told CNBC on Thursday at the World Economic Forum in Davos, Switzerland.

"So while this isn't a full-scale recession, it is definitely a growth recession and it will mean continued downward pressure on commodity prices and it will also mean continued weakness in demand for the exports of countries in the supply chain to China and indirectly for the rest of the world. So it is bad news; it is entirely avoidable with the right policies, but the Chinese authorities are not yet ready to implement these right policies," he added.

Global economic growth at current exchange rates slowed to around 2.3 percent year-on-year in the fourth quarter of 2015, according to a Citi report out on Thursday. The bank said this was roughly equal to 2 percent year-on-year, "adjusted for the probable mis-measures of China's GDP growth rate."

Chinese official economic data is often said to be exaggerated, although the magnitude is a matter of contention. The country reported growth of 6.9 percent in 2015.

Citi said that global growth would rise slightly in the coming quarters, as the collapse in oil prices was likely to support consumer spending in advanced economies.

Oil prices stabilized near 2003 lows on Thursday, having dipped below $27 per barrel on Wednesday.

Russia and South Africa suffered the worst cuts to 2016 growth forecasts by Citi. The Russian economy is seen shrinking by 0.5 percent, struggling with low oil prices and international sanctions, while South Africa is expected to post anemic growth of 0.3 percent.

"The global outlook is at a critical point of vulnerability. The last few years have seen an uneasy equilibrium between repeated disappointment in global growth and offsetting monetary policy stimulus. That balance is now at risk," economists led by Buiter said in the report.

"Risks to our growth forecasts probably remain to the downside, especially for emerging markets. Risks of global recession (which we define for current purposes as sub-2 percent global growth, China-adjusted) are rising," they later added.